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It took a logistical miracle to install this 96-metre-long splitter, which turns propane culled from oil sands extraction into plastic Y FINLA THLEEN KA M) TO OT (B DEPARTMENTSFEATURES ON; ents 4 Feedback 12 Panorama NICHOLS What’s bigger than the AN 5 The Rant Statue of Liberty, weighs EW Call it Canada’s 820 tonnes, and turns OP) intergenerational shame: propane into carpets (T ; Newborns are getting and car bumpers? CAS stuck with the bill for LU nt KE boomer excess 14 Trichur LU Most millennials will BY 9 The Exchange never be able to buy a Lundin CEO Marie home, and the CMHC’s THE TOP GAZINE MA Inkster has a plan to new mortgage-subsidy SS change mining’s bad scheme won’t help 1000 reputation, starting with BUSINE co corruption-proofing 15 McGugan INVESTORS’ ON T her own executives Ottawa and the provinces waste billions on GUIDE REPOR R business subsidies. Why Our 35th annual ranking of the FO Y can’t they just say no? largest publicly traded companies in Canada by revenue. (Spoiler: Last USIVEL 102 Last Word CL EX Hotelier Christiane year’s No. 1 came out on toP again). ED Germain on how to avoid PLUS:Our Megastar stock picks for AT TR family feuds, why she 2019, our annual market outlook US doesn’t sweat Airbnb ILL and her biggest mistake and inside Shopify’s push to bring VER as an entrepreneur e-commerce to the masses CO MAY 2019 / REPORT ON BUSINESS 3 May 2019, Volume 35, No.9 Feedback Editorial Editor, Report on Business DEREK DECLOET Lait man’s terms Assistant Editor DAWN CALLEJA Jason Kirby profiled dairy scion Lino Saputo Jr., Senior Editor JOHN DALY who is defying the curse of the third generation Copy Editor LISA FIELDING, MICHAEL BARCLAY with a successful global expansion Research CATHERINE DOWLING Art Art Director DOMENIC MACRI proposing a penalty as opposed to Associate Art Director criminal prosecution. Either way, Send us your BRENNAN HIGGINBOTHAM thoughts at Director of Photography - The milk cartel has to go, SNC is penalized. —Sweet Red Dog robmagletters@ CLARE VANDER MEERSCH regardless of Saputo’s strong globeandmail.com, tweet us @ Contributors leadership. Canadian consumers - Even if SNC’s engineers were robmagca and STEVE BREARTON, TREVOR COLE, follow us on have been gouged for decades, so hired elsewhere, they might no Instagram @ TIM KILADZE, IAN MCGUGAN, the awakening is near. The only longer be working for Canadian rob_magazine JOANNA PACHNER, ERIC REGULY, way we can change the current companies. And driving SNC RITA TRICHUR, LUIS MORA monopoly is to completely out of Canada would mean these Advertising boycott Canadian dairy. projects would go to foreign Chief Revenue Officer, VP Advertising ANDREW SAUNDERS —Unlimited reader companies. Why damage a major Managing Director, Creative Studios Canadian multinational that, and Ad Innovation - The article omits the largest by all accounts, has straightened TRACY DAY Canadian purchase made by the ship? —res ipsa loquitor Senior Manager, Special Products Saputo. In [2000], it bought ANDREA D’ANDRADE Dairyworld, headquartered near Bay Street so white Product Manager RYAN HYSTEAD Vancouver. In typical Saputo Hadiya Roderique’s Rant made the Production fashion, the poorly managed case for anonymized resumés. Managing Director, Print Production co-operative was going bankrupt, SALLY PIRRI and Saputo picked it up for 40 - Let’s wait to see how many Production Co-ordinator cents on the dollar and turned Canadian CEOs go to HR and say: ISABELLE CABRAL it around. —loba1204 “Do not look at names—get me Publisher PHILLIP CRAWLEY Editor-in-Chief, The Globe and Mail DAVID WALMSLEY Managing Director, Business and Financial Products Shouldn’t Saputo be called GARTH THOMAS Report on Business magazine is published “le Grand Fromage” rather than 10 times a year by The Globe and Mail Inc., 351 King Street E., Toronto “the Big Cheese”? M5A 0N1. Telephone 416-585-5000. Letters to the Editor: Opportunity missed in the [email protected]. The next issue will be on May 31. Copyright 2019, The Globe and Mail. headline department Indexed in the Canadian Periodical Index. Advertising Offices Head Office, The Globe and Mail, 351 King Street E., Toronto M5A 0N1 To save or not to save the best person!” I hope I live Telephone 416-585-5111 or toll-free Paul Tellier urged the feds to step in a long time, because it may take 1-866-999-9237 Branch Offices to keep SNC-Lavalin in Canada. a while. —Maisie Vanriel Montreal 514-982-3050 Vancouver 604-685-0308 - No one came to the rescue of Standing tall Calgary 403-245-4987 Email: [email protected] BlackBerry or Nortel, or the long The tale of a small engineering firm United States and countries outside of list of other Canadian global helping to build supertall towers North America: AJR Media Group, 212-426-5932, firms that went upside down. ignited some Canadian pride. [email protected] Yet all those fine employees Publications mail registration No. 7418. survived. The only person soon Take note, SNC-Lavalin. Looks The publisher accepts no responsibility for unsolicited manuscripts, transparencies or other to be unemployable will be Justin like you’re not the only Canucks material. Printed in Canada by Transcontinental Trudeau. —Ceejaybee who can compete on the world Printing Inc. Prepress by DM Digital+1. Report on Business magazine is electronically available stage. Perhaps a few of those 9,000 through subscription to Factiva.com from Factiva, - The Liberals are not defending jobs could end up in Guelph... at factiva.com/factiva or 416-306-2003. criminal behaviour—they are —WhistlingIntheDark tgam.ca/r 4 MAY 2019 / REPORT ON BUSINESS month is th The Rant Million-dollar baby Is it fair for adults to stick the next generation with a hefty tax bill? Today’s newborns are set to pay a whopping $736,000 more in taxes than they will receive in individual benefits You might have heard there’s a federal election coming soon. Of course, its outcome: newborns. They may the recent budget made that plain enough, with goodies and special pro- not be able to feed themselves, grams for nearly every identifiable demographic: seniors, young home- or even speak or roll over right ISLAND buyers, small business owners, rural folk, middle-aged job hunters, now—and they certainly can’t M Indigenous people, and on and on. If there’s a recognizable segment of vote—but these adorable little SA society out there, you can bet there’s a pre-election perk with their name droolers will one day be handed a IONS on it—with a single unfortunate exception. bill for every one of our collective AT TR The one slice of Canadian demography certain to be ignored in the mistakes and indulgences. Given US coming election is, tragically, the very group with the greatest stake in the size and shape of this future ILL MAY 2019 / REPORT ON BUSINESS 5 “The internal combustion engine is all but obsolete, really, 30 MINUTES for future development. It’s all about electric.” —Greg McDougall, Estimated range of current CEO of Vancouver-based seaplane airline Harbour Air, which is adding electric aircraft right now, a fully electric plane to its fleet of 42 aircraft, a world first with a half-hour reserve GENERATION REAL LIFETIME NET TAXES FOR CURRENT working folk who are available to CLEANS UP GENERATIONS BY YEAR OF BIRTH ($000s) pay taxes, while increasing the Canadians born in 800 amount of health care and elderly the 1970s are set benefits owing, combined with to face a relatively the accumulation of past govern- low net tax burden 600 ment debt. Mahboubi’s results over their lifetimes, also reveal some striking gender while the totals disparities. A male newborn can for newborns are 400 expect to pay $1.5 million in net on track to soar taxes over his lifetime, whereas a female newborn will contrib- 200 ute a mere $82,000. The reason? Women work and earn less, mean- ing they pay fewer taxes. Plus, 100 they tend to live longer, and are more likely to receive child bene- 10 70 30 20 40 19 fit and social assistance payments. 19 19 1950 1990 1960 1980 20 19 2000 Generational accounting was first applied to Canada in the mid- burden, we ought to consider their 1990s, during an era of uncon- absence from electoral debate These adorable trolled government spending and to be a national, intergenerational little droolers will rapidly rising public debt. Econo- embarrassment. mists Philip Oreopoulos, then Recently, the C.D. Howe Institute one day be handed an analyst at the Montreal-based used an economic technique called a bill for every one Institute for Research on Pub- lifetime generational accounting to of our collective lic Policy and now a University assess the fairness of Canada’s fis- mistakes and of Toronto professor, and Bos- cal policies.